Eli5 how do mid level people in mlm make money?

Question

I understand that mostly they don’t and its only the people ar the top of the pyramid that make good money but how does it work if you are just selling products on at a set price? Thanks

In: 4

Answer 1

You buy the product from the company. You’re in the hole. You keep whatever money you can get from however much you manage to sell. If you make more than you paid the company for the product, you’ve made money.

The problem is that the products are typically substandard and overpriced meaning you’ll have a hard time of that without leveraging something else, like your family and friends (guilt tripping) or if you have some small amount of local fame. The religious are often targets of MLMs so they can also leverage their church connections.

But there’s only so much the people close to you will buy, and it’s hard to reach beyond that circle. That’s why MLMs are just pyramid schemes in disguise; you don’t make money selling to your small group of friends and family. You make money by convincing some of your small group of friends and family to convince some of their groups to convince some of their groups to sell. Everyone selling still has a hard time because of the reasons so they make little to no money, but IIRC, you get a cut of the money those people spend to buy the products to sell, so it doesn’t matter if they sell or not.

Also just to point out an issue with your question, if you’re “*just* selling products” then you’re not mid-level, you’re base-level.

Edit to add an additional challenge to the selling: Once you start recruiting your friends and family, who are you going to sell to? Who are they going to sell to? There’s a lot of crossover, so they’ll either have to fight over shared relationships or focus on the ones unique to them. I’ve seen people try to go outside of their circle by “advertising” at restaurants (leaving cards or signs without permission), I’ve even had a coworker hold a meeting. In r/antiMLM there have been stories of bosses pushing it on their employees, cold “calling” (coldDMing?) people on social media, buying booths at farmer’s markets, flea markets, craft fairs… All desperately trying to get beyond the small circle of family and friends they haven’t driven away or bled dry.